3 Obstacles Created by Paper-Based Onboarding in Wealth Management


May 2, 2016


How wealth management firms are suffering due to out of date onboarding systems.


Note: This is Part 1 of 3-part series on Digital Client Onboarding in Wealth Management. Part 2 can be found here.



It’s not only the advent of robo-advisors, it’s the digital climate we live in. You sign up for cable online, you pay phone bills online, you order furniture online, and so it follows that, with companies like Betterment and Schwab Intelligent Portfolios, you invest online. The bar has been set for consumers to expect a digital onboarding process in whatever they put their money into. Yet, the client onboarding processes of many wealth management firms is still paper-based. Given the digital expectations set by companies like Wealthfront and FutureAdvisor, that’s a problem.


But, it’s not just customer expectations you have to worry about. Paper-based onboarding is also costing you money and jeopardizing your client retention rates.


Here are the three main problems paper-based onboarding is causing your firm:


  1. Frustrating your clients


I remember the feeling. Email after email would show up in my inbox. Again? Again, I have to re-sign this form, go to my printer, scan it back to my computer, download the scan, and then email back to my mortgage broker? When I was buying my first home, paper-based onboarding wasn’t only an inconvenience, it was an interruption to my work-life. And that was only for me as a client. I can only imagine how frustrating it was for my broker.


Even though I was buying my first home and didn’t know exactly what I was doing, it still exemplifies the fact that paper-based onboarding isn’t as simple as filling out a few forms. With only one or two mistakes, filling out a few forms turns into a mile-long email thread and a dissatisfied client.


But, that’s not the only reason paper-based onboarding frustrates clients. Most consumers have gotten used to the ease of inputting their payment information digitally. Clients are doing everything from buying concert tickets to setting up automatic withdrawals for their gas bill by inputting payment information online. Therefore, when they show up to their wealth advisor’s office to sign an outdated data collection form, you can understand why they’d leave thinking, “my wealth firm is out of date.”


  1. Costing you money


If it’s the way you’ve always done it, you might not realize the time and resources that paper-based onboarding is costing you. It’s eating your bottom line in two main ways.


First, administrative hours.

Data-entry takes up a lot of your firm’s time even when there are no hiccups in the process. However, when a mistake has been made somewhere down the line and administrators have to return a form to the advisor, which then needs to go back to the client, those long administration hours can substantially drain resources. On top of this, when compliance regulations change and forms need revision, it’s not as easy as changing a few lines in a Word doc. Old forms need to be shredded and new ones need to be printed and sent out. The editing, printing and switching of any new forms not only uses a lot of paper, but also consumes costly administrative hours. The worst part? Administration is completely unscalable. As your business grows, you have no choice but to hire more administrative staff.


Second, missed opportunities.

Paper-based onboarding is also costing you money by using up valuable advisor time. Every time your wealth advisor has to deal with paperwork, data, or administrative problems, he or she is working outside of a revenue-generating activity. Every activity comes with a trade-off. For advisors, every decision involves choosing to find clients and make their clients money, or do something else. Rather than connecting with a client, your advisors are searching through documents trying to find a small piece of information to complete a form. Which leads us to the next problem with paper-based onboarding.


  1. Frustrating your advisors.


Most of the time, your advisors are not the ones sorting through initial piles of paperwork. Organizing forms and entering data into a CRM are usually jobs reserved for an administrator. Yet, many of these forms will still end up on an advisor’s desks to follow up on client mistakes and misinformation. What frustrates your advisors is that the data from these forms isn’t easily accessible and comprehensive. Your advisors are trying to design financial strategies for their clients, but the information is tied up in a CRM, PDF or in paper. When advisors can’t easily export, visualize, and build reports from these formats, their work slows down and frustration culminates into a dissatisfaction with their firm.


If you’re using paper-based onboarding and experiencing some of these frustrations, then you may want to consider converting to a fully digital client onboarding process. Don’t know if you’re primarily paper-based? Here are some diagnostic questions:


  1. Do you ever have to print a document for any reason during the onboarding process?
  2. Do clients have to use a wet ink signature at any point in your onboarding process?
  3. Do you have mandatory forms from other departments and external organizations that you submit in paper form, or in email attachments?


If you’re nodding your head as you read through this list, then you are still paper-based in your onboarding process.


Take the first steps toward a fully digital onboarding process by downloading this free eBook. It will give you the overview you need to decide whether or not an onboarding automation platform is the right step for your firm.


Download eBook here


You can read Part 2 of this blog series here.